Nation & World

Posted: Tuesday, November 08, 2005

Homebuilder Toll Brothers Inc. (NYSE: TOL) cut its sales forecast for fiscal 2006 Tuesday, citing delayed openings for new developments and weakened demand in several markets. The news pushed its shares down 14 percent and was widely blamed for a decline in the stocks of many large homebuilders. KB Home (NYSE: KBH) fell 5.5 percent and Pulte Homes Inc. (NYSE: PHM) lost nearly 9 percent. The market was reacting to concern that the strong housing market, which is widely credited for having supported the economy, is faltering.

The nation's oldest bank, The Bank of New York, has agreed to pay $38 million in fines and adopt reforms to end a long-running federal investigation into fraud and money laundering, prosecutors said Tuesday. In exchange, prosecutors said they would not pursue the bank for failing to enforce federally mandated anti-money laundering measures and other banking rules. The agreement stems largely from an international scheme that U.S. authorities said involved $7 billion in illicit transfers from Russia in the late 1990s.

China and the United States agreed Tuesday to a three-year pact to limit Chinese clothing and textile imports, a deal that will help the beleaguered U.S. industry but cost the average American family $10 to $20 annually in higher clothing bills. Even with resolution of the textile fight, many trade issues remain, from theft of U.S. computer programs to Chinese manipulation of its currency. The Bush administration has been pressuring China and must report to Congress on the issue later this month.

Blockbuster Inc. (NYSE: BBI), the nation's largest movie-rental chain, warned Tuesday that it could be forced into bankruptcy if a new credit agreement with lenders doesn't become effective or if lenders recall loans because of failure to meet debt covenants - typically things like exceeding debt ratios. The company posted a $491.4 million third-quarter loss as the elimination of most late fees continued to chip away at revenue and the growth of the company's online service stalled. The company's shares fell 2.3 percent.